Dubai Gold and Commodities Exchange (DGCX) has announced that it will list a futures contract on the Indian rupee in the next two months. This will be the first time in the world that an Indian rupee currency contract will be traded on an organized exchange.
“The Indian Rupee contract represents yet another addition to the growing list of ‘firsts’ in DGCX’s short history”, said Colin Griffith, DGCX Chairman and Executive Director of the DMCC, the 51% owner of the exchange. “DGCX was the first futures exchange in the Middle East, DGCX currency contracts launched last June were the first exchange-traded currencies in the Middle East and now with the launch of our Indian Rupee contract we can claim a global first”.
“The DGCX Rupee contract can be viewed as a natural extension of the non-deliverable forward (“NDF”) inter-bank market that already exists in various financial centers”, added Mr Griffith. “The DGCX futures market does, however, have advantages over the NDF market, such as transparency of price discovery and the benefits of centrally cleared market positions”.
Each DGCX Indian rupee contract represents two million Rupees. Prices will be quoted in US Cents per 100 Indian Rupees, with a minimum price fluctuation of 0.000001 US Dollars per Rupee ($2 per contract). At any point in time DGCX will list the current and next two calendar months, plus the next calendar quarterly month. Further delivery months will be added as market liquidity grows.
DGCX officials said that the Indian Rupee futures contract will be of use to traders who import into, or export from, India, together with others who remit funds to India from time to time.
The DGCX currently lists Gold, Silver, Fuel Oil and three currency pairs; Euro/US Dollar, GB Pound Sterling/US Dollar and Japanese Yen/US Dollar.
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